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Genetically engineered organisms can more efficiently produce ethanol from cheap and abundant sources of biomass, such as agricultural waste. It could make ethanol cost competitive.

On January 31, Ari Patrinos was sitting in his living room in Rockville, MD, listening to the State of the Union speech and slowly nodding off. Suddenly, he was jolted awake.

Colonies of recombinant Streptomyces bacteria are designed to produce enzymes called cellulases. With these enzymes, the bacteria can break down cellulose on the way to producing ethanol. (Courtesy of NREL/U.S. Dept. of Energy/Photo Researchers)

“We’ll also fund additional research for cutting-edge methods of producing ethanol,” President Bush was saying on the television, “not just from corn but from wood chips and stalks or switchgrass. Our goal is to make this new kind of ethanol practical and competitive within six years.”

Unlike most of the legislators who gamely applauded the president’s words, Patrinos understood exactly what they meant. In fact, he had dashed them off himself days earlier at the harried request of his boss, unaware that they were destined for the State of the Union speech. Patrinos, then associate director of the U.S. Department of Energy’s Office of Biological and Environmental Research, had been touting cellulosic ethanol as an alternative energy source for years, only to be met with indifference or ridicule. Now, it seemed, even the most petro-friendly of politicians was convinced.

Producing ethanol fuel from biomass is attractive for a number of reasons. At a time of soaring gas prices and worries over the long-term availability of foreign oil, the domestic supply of raw materials for making biofuels appears nearly unlimited. Meanwhile, the amount of carbon dioxide dumped into the atmosphere annually by burning fossil fuels is projected to rise worldwide from about 24 billion metric tons in 2002 to 33 billion metric tons in 2015. Burning a gallon of ethanol, on the other hand, adds little to the total carbon in the atmosphere, since the carbon dioxide given off in the process is roughly equal to the amount absorbed by the plants used to produce the next gallon.

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Using ethanol for auto fuel is hardly a new idea (see “Brazil’s Bounty”). Since the energy crisis of the early 1970s, tax incentives have pushed ethanol production up; in 2005, it reached four billion gallons a year. But that still translates to only 3 percent of the fuel in American gas tanks. One reason for the limited use of ethanol is that in the United States, it’s made almost exclusively from cornstarch; the process is inefficient and competes with other agricultural uses of corn. While it is relatively easy to convert the starch in corn kernels into the sugars needed to produce ethanol, the fuel yield is low compared with the amount of energy that goes into raising and harvesting the crops. Processing ethanol from cellulose – wheat and rice straw, switchgrass, paper pulp, agricultural waste products like corn cobs and leaves – has the potential to squeeze at least twice as much fuel from the same area of land, because so much more biomass is available per acre. Moreover, such an approach would use feedstocks that are otherwise essentially worthless.

Converting cellulose to ethanol involves two fundamental steps: breaking the long chains of cellulose molecules into glucose and other sugars, and fermenting those sugars into ethanol. In nature, these processes are performed by different organisms: fungi and bacteria that use enzymes (cellulases) to “free” the sugar in cellulose, and other microbes, primarily yeasts, that ferment sugars into alcohol.

In 2004, Iogen, a Canadian biotechnology company based in Ottawa, began selling modest amounts of cellulosic ethanol, made using common wheat straw as feedstock and a tropical fungus genetically enhanced to hyperproduce its cellulose-digesting enzymes. But Iogen estimates that its first full-scale commercial plant, for which it hopes to break ground in 2007, will cost $300 million – five times the cost of a conventional corn-fed ethanol facility of similar size.

The more one can fiddle with the ethanol-producing microbes to reduce the number of steps in the conversion process, the lower costs will be, and the sooner cellulosic ethanol will become commercially competitive. In conventional production, for instance, ethanol has to be continually removed from fermentation reactors, because the yeasts cannot tolerate too much of it. MIT’s Greg Stephanopoulos, a professor of chemical engineering, has developed a yeast that can tolerate 50 percent more ethanol. But, he says, such genetic engineering involves more than just splicing in a gene or two. “The question isn’t whether we can make an organism that makes ethanol,” says Stephanopoulos. “It’s how we can engineer a whole network of reactions to convert different sugars into ethanol at high yields and productivities. Ethanol tolerance is a property of the system, not a single gene. If we want to increase the overall yield, we have to manipulate many genes at the same time.”

The ideal organism would do it all – break down cellulose like a bacterium, ferment sugar like a yeast, tolerate high concentrations of ethanol, and devote most of its metabolic resources to producing just ethanol. There are two strategies for creating such an all-purpose bug. One is to modify an existing microbe by adding desired genetic pathways from other organisms and “knocking out” undesirable ones; the other is to start with the clean slate of a stripped-down synthetic cell and build a custom genome almost from scratch.

Lee Lynd, an engineering professor at Dartmouth University, is betting on the first approach. He and his colleagues want to collapse the many biologically mediated steps involved in ethanol production into one. “This is a potentially game-changing breakthrough in low-cost processing of cellulosic biomass,” he says. The strategy could involve either modifying an organism that naturally metabolizes cellulose so that it produces high yields of ethanol, or engineering a natural ethanol producer so that it metabolizes cellulose.

This May, Lynd and his colleagues reported advances on both fronts. A team from the University of Stellenbosch in South Africa that had collaborated with Lynd announced that it had designed a yeast that can survive on cellulose alone, breaking down the complex molecules and fermenting the resultant simple sugars into ethanol. At the same time, Lynd’s group reported engineering a “thermophilic” bacterium – one that naturally lives in high-temperature environments – whose only fermentation product is ethanol. Other organisms have been engineered to perform similar sleights of hand at normal temperatures, but Lynd’s recombinant microbe does so at the high temperatures where commercial cellulases work best. “We’re much closer to commercial use than people think,” says Lynd, who is commercializing advanced ethanol technology at Mascoma, a startup in Cambridge, MA.

Others are pursuing a far more radical approach. Soon after the State of the Union speech, Patrinos left the DOE to become president of Synthetic Genomics, a startup in Rockville, MD, founded by Craig Venter, the iconoclastic biologist who led the private effort to decode the human genome. Synthetic Genomics is in hot pursuit of a bacterium “that will do everything,” as Venter puts it. With funding from Synthetic Genomics, scientists at the J. Craig Venter Institute are adding and subtracting genes from natural organisms using the recombinant techniques employed by other microbial engineers. In the long run, however, Venter is counting on an approach more in keeping with his reputation as a trailblazer. Rather than modify existing organisms to produce ethanol and other potential biofuels, he wants to build new ones.

Natural selection, argues Venter, does not design life forms to efficiently perform the multitudinous functions their genes encode, much less to carry out a dedicated task like ethanol production. Consequently, a huge amount of effort and expense goes toward figuring out how to shut down complex, often redundant genetic pathways that billions of years of evolution have etched into organisms. Why not start with a genome that has only the minimal number of genes needed to sustain life and add to it what you need? “With a synthetic cell, you only have the pathways in there that you want to be in there,” he says.

Synthetic Genomics’ approach is based on research that Venter’s Institute for Genomic Research conducted on a microörganism called Mycoplasma genitalium in the late 1990s. The microbe, which dwells in the human urinary tract, has only 517 genes. While that’s the smallest genome seen in any life form known, researchers in Venter’s group showed that the organism could survive even after they had knocked out almost half of its protein-coding genes (some genes code not for proteins but for other biomolecules that perform regulatory functions within the cell). Using the DNA sequence of this “minimal genome” as a guide, they are now attempting to synthesize an artificial chromosome that, inserted into a hollowed-out cell, will lead to a viable life form. Once they are over this first hurdle, they plan to build synthesized, task-specific genetic pathways into the genome, much the way one might load software onto a computer’s operating system. Rather than create spreadsheets or do word processing, however, such “biologically based software” would instruct the cell to break down cellulose to produce ethanol or carry out other useful functions. “This is a totally new field on the verge of explosion,” says Venter.

Among biofuels, ethanol is the established front-runner, but various types of microbes also produce hydrogen, methane, biodiesel, and even electricity – which means they could be genetically engineered to produce more of these resources. At the University of California, Berkeley, bioengineer Jay Keasling and his colleagues are proposing to design organisms that pump out a fuel no natural microbe makes, one that offers some alluring advantages over ethanol: gasoline. Its virtues as a fuel are proven, of course, and the ability to produce it from waste wood and waste paper, which Keasling thinks is feasible, could reduce countries’ dependence on foreign oil. And unlike ethanol, which is water soluble and must be transported in trucks lest it pick up water in pipes, biologically generated octane could be economically piped to consumers, just like today’s gas.

“Ethanol has a place, but it’s probably not the best fuel in the long term,” says Keasling. “People have been using it for a long time to make wine and beer. But there’s no reason we have to settle for a 5,000-year-old fuel.”

In the short term, some advances in biology and engineering are needed before fuels made from biomass will be practical and competitive with fossil fuels. But in the longer term, says Venter, “we’re limited mostly by our imagination, not by the limits of biology.”

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